Under Armour says digital revenue in Q1 nearly tops 2015 tally
Under Armour said it will continue to test and experiment with 3D printed midsoles, invest in SAP and IBM systems to manage and analyze customers and ramp its digital revenue, which in the first quarter nearly eclipsed all of the sales from apps produced in 2015.
Those were some of the high level takeaways from Under Armour CEO Kevin Plank. Most of Under Armour’s first quarter conference call revolved around sales of the Curry 2, named after Golden State Warriors star Stephen Curry. Under Armour reported operating income of $35 million in the first quarter on revenue of $1.05 billion. The company also raised its 2016 revenue target to $5 billion.
When not talking up Curry, Plank outlined a few tech tidbits worth noting. Here are the key points from Under Armour’s first quarter conference call.
Fitness tracking is going untethered and button free. Plank said the initial response to the Under Armour Gemini 2 with its Record platform has been strong. Under Armour’s Gemini 2 running shoe tracks steps and uploads time, date and distance directly to dashboard.
3-D printing can work. Under Armour also launched a show called the Architect that was customized with 3D printed midsoles. The shoes, which went for $300, sold out in 19 minutes. “We will continue to test and learn with this technology and customization and you can expect new 3-D printed iterations later this year,” said Plank.
E-commerce growth. More than half of Under Armour’s e-commerce traffic is coming from mobile devices. The women’s e-commerce growth is outpacing demand from men. Direct e-commerce from Under Armour’s connected fitness apps is also picking up.
The UA Health Box connected bundle saw strong demand and was the second best selling item behind the Curry 2 shoe.
Connected fitness revenue picking up. Plank said that in the first quarter, Under Armour nearly did its entire 2015 revenue in the first quarter. “We see things like premium and we see things like subscription. We see opportunity for us there,” said Plank. “We laid that bogey of about $200 million in 2018, and we feel very good about that.”
Data efforts and customer engagement. Plank also said Under Armour continues to invest in its SAP platform to gain one view of the business and customer. Plank said:
We are not burdened with so much legacy, and have the ability to truly defined with the company in the future as it should look like and using things like a recommendation engine based on previous purchasing history, knowing the activities that consumers are engaging in to meet the consumer where they are and with better products for them at the right time.
But our investments are going to enable us to build out what we are calling our math house with data and ultimately help us sell more short and shoes. With IBM and the Watson platform, we are gaining more competency in the data analytics.